On Wednesday 30 September, the German Presidency of the Council of the European Union noted that a qualified majority of Member States at the level of their EU ambassadors (Coreper) had been found in favour of its proposal for a Regulation linking the disbursement of funds from the EU budget to respect for the Rule of law (see EUROPE 12570/22, 12569/1).
As a result, negotiations with the European Parliament will be able to start “soon”, according to one source.
At Coreper on Wednesday, the countries that opposed the text (which is expected to undergo minor changes) are: – Hungary and Poland, which are opposed in principle to any conditionality relating to the Rule of law; – Sweden, Finland, Denmark, the Netherlands and Belgium, which, on the contrary, are calling for a more robust mechanism than the one proposed, thus closer to the Commission’s initial proposal in May 2018 (voting by a qualified ‘reverse’ majority of Member States).
Austria and Luxembourg abstained.
A Dutch diplomatic source reminded EUROPE that the agreement of the European Council in July constituted a package (2021-2027 Multiannual Financial Framework, European Recovery Plan, Own Resources Decision, ‘Rule of law’ conditionality) and that, for the Netherlands, it is impossible to make progress in the negotiations on one element “without having details on the others”.
Moreover, according to the Dutch authorities, the proposal on the table does not reflect the July agreement. “Limiting the Commission’s room for manoeuvre is a mistake and it amounts to changing the treaties through the side door”, the source said. The source also warned, “If this is the case, we will not be able to accept it, which will have serious consequences for the ratification of the Own Resources Decision by the Dutch Parliament”.
Ratification of this decision is necessary to give substance to the EU’s post-Covid-19 Economic Recovery Plan.
Qualified majority voting. Detailed in our columns, the German Presidency’s proposal introduces a decision-making procedure involving qualified majority voting in the EU Council to impose sanctions in the form of suspension of EU funds on a Member State that does not respect the Rule of law. It also introduces an ‘emergency brake’, whereby the matter can be referred to the European Council, resulting in a decision delayed by up to three months.
Presented on Wednesday (see EUROPE 12571/5), the European Commission's first annual report on the Rule of law in the EU warns that the European Council's commitment should “speed up the adoption of the Commission's proposal to protect the EU budget in the event of a breach of the Rule of law in a Member State”.
On Wednesday, Vice-President for Values, Vera Jourova, welcomed the fact that EU Council/European Parliament negotiations could begin on a regulation linking the budget to the Rule of law. She said she “could live with the text on the table”, which is better than a procedure involving unanimous voting in the EU Council.
The EPP group in Parliament recalled that it “strongly supports the inclusion of a conditionality clause in the next Multiannual Financial Framework on democracy, rule of law and fundamental rights, linking EU financing to respect for the Rule of law”.
Negotiations to resume on 5 and 8 October. The next sessions of interinstitutional negotiations on the MFF are scheduled for Monday 5 and Thursday 8 October.
Parliament continues to insist on increased funding for the EU’s flagship programmes. In addition, it calls for a binding timetable on new own resources to reimburse the cost of the Recovery Plan.
The German ambassador expressed concern. German Ambassador to the EU Michael Clauß told EUROPE on Wednesday that it is important that a large majority of member states support the mandate to negotiate with Parliament on the ‘Rule of law’ mechanism.
“At the same time, my concern has grown that with the heated debate on the Rule of law mechanism within the EU and also in the Council of Member States we are increasingly running into a blockade in the overall budget negotiations. The timetable is shifting further and further back. Already now, delays with consequences for Europe’s economic recovery will most likely be unavoidable”, he lamented.
See the proposal for a Regulation: https://bit.ly/34exUIi
For more information, see: https://bit.ly/3cNwEQn (Original version in French by Lionel Changeur, with the editorial staff)